Behavioral Food Subsidies

Dr. Andy Brownback is an Assistant Professor of Economics at the University of Arkansas, specializing in behavioral and experimental economics.

Can Making Family Salient Increase Financial Savings? Quantifying Heterogeneous Treatment Effects in Voluntary Retirement Contributions Using a Field Experiment in Mexico

We demonstrate that sending this intervention to all account holders would increase profits by $375,800 pesos ($19,032 USD). In contrast, a strategic application of this intervention to profi table individuals only would increase profits by $4,887,000 pesos ($246,000 USD). From a consumer welfare perspective, this strategic application would also generate 4,597 new voluntary retirement contributors (the blanket approach would generate 2,340 new contributors).

Retail Price Premiums for Organic Fresh Fruits and Vegetables

Organic foods are one of the fastest-growing food market segments in the United States, with an average annual growth rate of approximately 14 percent in the last two decades. Despite the large and growing importance of organic foods, we have only limited information about retail price premiums and how these have changed over time, across space, and products. This paper addresses the gap by estimating retail price premiums for organic fresh fruits and vegetables (FFVs) using data and methods that are novel to the field. Specifically, we estimate premiums by constructing panel price indices for both conventional and organic FFVs using point-of-sale scanner data. Our sample includes data from grocery stores and mass merchandisers in 24 contagious Metropolitan Statistical Areas between 2009 and 2017. Our main result is that the national average organic price premiums in the FFV market range between 58 and 92 percent over the period 2009-2017. The premiums are persistent and have been trending upward over this period. We also find that differences in premiums across regions are substantial, while they have slightly converged during the study period. Another substantive contribution of the paper pertains to the “ideal” measurement of price premiums, that has been overlooked in the prior literature. We show that price premiums are substantially overestimated if the compared basket of conventional products is not the same as that of organic products.

Farmers to Entrepreneurs

We study the birth of non farming enterprise in the developing world. We test if such activities are led by skills or are an ex-post income smoothing device for uninsured households. We find that farmers become entrepreneurs in response to negative productivity shocks to farming, while credit constraints do not seem to play a substantial role. Importantly, and consistently with irreversible Acs (2006) investment or learning-by-doing, these reluctant entrepreneurs do not revert to full farming following new positive productivity shocks. These entrepreneurs are typically under performing entrepreneurs while they were above average farmers. This selection might contribute to the understanding of the dual phenomenon of low-productivity units coexisting in developing countries.